Tax advisers could face £1m fines in HMRC crackdown
HMRC launches crackdown on tax avoidance targeting scheme advisers and promoters - and plans penalties of up to £1m
In a consultation HMRC has laid out plans to identify publicly those it calls “high-risk” promoters of avoidance schemes, isolating them from “mainstream” advisers.
A spokesperson for the Treasury said financial advisers could be designated high-risk promoters and so would be liable for the £1m fine, Accountancy Age’s sister title IFAonline reports.
The taxman wants to use its powers to get early information about their products and make it clear to their customers who they are dealing with.
It is proposing that the initial penalty on the high-risk promoter could be up to £1m with a continuing failure penalty of £10,000 for each day that the failure continues after the initial penalty is imposed.
“Without a suitable penalty regime there would be no new incentive for high-risk promoters to change their behaviours, for their intermediaries to stop marketing their products, or for their users to stop purchasing their products,” the consultation said.
HMRC said there is evidence that many mainstream tax advisers are increasingly unwilling to advise clients to undertake tax avoidance.
“For those who persist in promoting avoidance, we expect them to be transparent with HMRC about what they are doing and transparent with their clients about the risks involved in undertaking tax avoidance….we will not tolerate promoters who sidestep their responsibilities,” the paper said.
HMRC said it plans to make it “significantly harder to market avoidance in the first place”.